The latest controversy over India’s poverty line proves two things. First, statistical illusions can be spun by presenting numbers in different ways. Second, India suffers from middle-class double standards and denial on poverty.
A media storm has arisen after the Planning Commission’s affidavit to the Supreme Court stated what all experts know—India’s poverty line is defined as consumption of Rs 32/day per person in urban areas and Rs 26 in rural areas. Outraged TV anchors and middle class viewers asked how on earth people could survive on so little. Reports cited pavement hawkers spending Rs 32/day just on bus tickets.
The Planning Commission was driven on the defensive. One member said poverty was a relative concept and he personally might view Rs 15,000 per month as being in poverty. The Commission clarified that Rs 32 per day would not be the cut-off for benefits like subsidized food—that would be decided by other criteria covering far more people.
Fact: the current poverty line (based on the Tendulkar Committee recommendations ) has actually been re-drawn well above the historical line. Far from fiddling the numbers downward, the new poverty line increased them from 27.5% to 37.2% in 2004-05′ translating into an additional 100 million poor.
A poverty line of Rs 32/day may outrage some, but the equivalent old poverty line was barely Rs 24/day. You saw relatively little middle class anger in past decades about that: many were in denial on the width and breadth of poverty.
If consumption of Rs 24/day (at today’s prices) was the poverty norm for decades, why does Rs 32/day sound so low today? Mainly because we don’t usually think in terms of consumption per day. The average family size in India is five members. Poor people have more children, so an average poor household will have around six members. If six members consume Rs 32/day, it adds up to almost Rs 6,000 per month.
I find most people are surprised that Rs 32 per person per day (which looks so low) translates into Rs 6,000 per household per month. They lose their initial sense of outrage’ and think Rs 6,000 per month is a reasonable poverty definition.
However, there’s more to this than statistical illusion. Foreigners find Rs 6,000 per month scandalously low. Why not our middle class? Answer: they often pay hired help just Rs 4,000-5,000 per month, and complain if servants demand more. Middle class folk don’t want to calculate the per capita daily spending of their servant’s family. They resent servants constantly wanting more pay, even if this falls short of the very level they find outrageous when specified by the Planning Commission.
This double standard is not restricted to paying servants. When middle class folk go to Dilli Haat to buy a sari, they will beat down the weavers to the lowest price possible. If told that the weaver earns only Rs 4,000 per month, will they change their attitude or agree that they have helped keep the weaver poor? No chance.
Don’t be too harsh on the middle class: double standards exist in almost every group of humans. The middle class is correct in blaming poverty mainly on the government. Enormous amounts are allocated to poverty alleviation by politicians shedding crocodile tears for the poor, but the sums are largely wasted or stolen.
The middle class strongly supports poverty alleviation. But it also wants massive subsidies itself, cheap cooking gas and kerosene being obvious examples.
Does this mean India’s progress in the last two decades has been illusory? Not at all. The poverty ratio did not change between independence and 1977-78′ although the population doubled. So, the total number of poor people doubled in the heyday of Indian socialism (many young socialists are in denial about this). Fortunately economic liberalization, starting in the 1980s and accelerating in the 1990s, stoked faster GDP growth and started reducing poverty.
India will probably exceed the UN Millennium Development Goal of halving poverty between 1990 and 2015. Even so, India will be a poor country for a long time. Forget statistics —just see the horrific workers’ hovels at construction sites. Workers nevertheless come because rural conditions are even worse.
The middle class has done a yeoman job crusading against corruption, which hits all classes. However, its main anger is about big political corruption. The poor are hit more by low-level corruption and pathetic government services. The middle class has stopped using government schools and other services. So, these topics attract less middle class anger—and TV ratings— than Big Corruption. We need more anger against lousy, corrupt government services.